EXCHANGE DEAL

New Zealand Herald, Volume LXXVII, Issue 23761, 14 September 1940, Page 12

EXCHANGE DEAL

ALLEGED ILLEGALITIES CONVERSION TRANSACTION TWO MEN CHARGED IN COURT [BY TELEGRAPH —PRESS ASSOCIATION] WELLINGTON, Friday Breaches of the Finance Emergency Regulations were alleged agaipst Robert lan Malcolm Sutherland, solicitor, and Norman John Suckling, manufacturers' representative. They were jointly charged in the Magistrate's Court to-day with being to a transaction involving the conversion of New Zealand currency into sterling currency at a rate of exchange other than the current rate, with making a payment in New Zealand as a consideration for receiving a payment outside New Zealand, and with dealing with money payable outside New Zealand as a consideration for receiving a payment in New Zealand. Suckling was charged alone with sending money out of New Zealand without the permission of the Minister of Finance. Both pleaded not guilty. Part of their defence was that the informations did not disclose any statutory offence. The charges were heard together. Facts of the Case It was stated for the Crown that the facts were that a Mr. S. J. Haydon, who went to live in California because of his wife's health, was given permission by the Reserve Bank to transmit to San Francisco £IOOO in February and six amounts of £IOO each in April, June, August, October, November and December. Sutherland was attorney in New Zealand for Haydon and on April 30 was informed by the Union Bank that it was the last day on which the April permit was available. Having no funds .available in Haydon's account, he arranged an illegal transaction with Suckling, whereby Suckling paid £IOB for the £IOO which, was equivalent to £BO sterling. Sutherland banked the £IOB to Haydon's credit and endorsed the draft with the signature of Haydon. It was despatched by Suckling to' his principals in Yorkshire, Suckling asking that £BO sterling be placed to his credit in England. Sutherland's Defence Giving evidence, Sutherland said Haydon mentioned before leaving New Zealand that he had a friend in Suckling's office and he was pleased to have a connection with Suckling, as the latter's principals overseas might be useful to him in his endeavours to begin business in America on his own account. Sutherland said he banked the £IOB given him by Suckling to Haydon's credit in a trust account endorsed the draft and gave it to Suckling. He did not know the terms of the arrangement between Haydon and' Suckling's office about the money. His principal concern on April 30, when all transactions except the handing over of the draft took place, was that he might miss collecting the April permit on his client's behalf. Answering Mr. Biss for the Crown, Sutherland said that on April 30 he did not hold enough money of Haydon's to pay for the April permit, in participating in this transaction he assumed that some arrangement had been made between Haydon, Suckling and Firths (Suckling's Yorkshire principals), whereby Firths might be taking money on Haydon's behalf, acting perhaps as his bankers. He thought the draft was going to England for Haydon for his benefit. Straightforward Action

Suckling, in evidence, said lie was aware that outgoing letters were dealt wjth by the censor. The draft was sent out in the mail in the ordinary straightforward way and he was greatly surprised when, informed it had been held up. To Mr. Biss, Suckling said he realised the regulations of April 10 would stop his buying of sterling. He mentioned the regulations to Sutherland, whose reply was he was getting a draft from a trading bank and it obviously must have the authority of the Reserve Bank. Suckling said he did not then know Haydon's permit had been issued months previously. To Mr. Pope, who appeared for Suckling himself, Suckling said he understood any arrangements made before the April regulations could legally be completed. Decision Reserved After evidence and legal < argument had been submitted, the magistrate said he considered cases of this nature of considerable importance and interest to the commercial community and the public generally. He therefore proposed to reserve his decision. Mr. H. R." Biss, who conducted the case for the Crown, said near the end of the hearing, that the police understood this to be the first prosecution of its kind in New .Zealand and had brought the case for the purpose of making the regulations more public. The police were not pressing for a heavy penalty, but wanted it to be brought before the public. He understood that breaches of these regulations were regarded seriously.